Toyota dealers aim for posh new image

BOERNE, Texas -- The North Park Toyota dealership in an affluent San Antonio suburb looks likes a rustic ski lodge plucked from the mountains.

The $8 million store, which opened in June, features 205 tons of rock. Large wood beams stretch across the ceiling.

In the center of the store, leather chairs and sofas surround a fireplace that invites you to kick back and take a nap.

"You won't find a fireplace in many stores," said Merle D. Gothard, a veteran Texas car salesman and general manager for North Park Toyota. "That's where our industry is going."

By 2010, Toyota Motor Corp. hopes to have upgraded each of its 1,220 U.S. dealerships to a look and feel it calls "Toyota Image USA II."

The North Park Toyota store varies somewhat from the template. To comply with local ordinances, the dealership had to incorporate local hill country architectural cues.

But the underlying elements behind North Park, one of Toyota's newest outlets, fit with the overall makeover taking place across U.S. dealerships, said Nancy Davies, vice president of retail market development for Toyota Motor Sales USA.

Toyota's new dealership image calls for adding:

Warm, inviting interior designs that have a residential feel.

Cafes and children's play areas to make wait times more bearable.

Bright graphics that hold the customer's attention and show off new products.

"I think everyone recognizes the customer deserves a good experience whenever they go and spend the money to buy a new car or truck," Davies said.

Luxury brands, such as Mercedes and BMW, already have upscale dealerships, said Rick Nelson, an analyst who follows the auto retail industry for Stephens Inc., a Chicago-based investment research firm.

Now dealers who sell mainstream brands are following suit, Nelson said. They're adding nicer wait areas and providing new conveniences, such as quick, affordable oil changes, he said.

The goal is to provide a comfortable environment for selling cars and also bring the customers back when service is needed, Nelson said. Service and parts departments typically provide higher profit margins for dealers than vehicle sales.

"Service and parts is the bread and butter for a dealer," Nelson said. "To the extent that you can attract that business, it drives profitability."

Gothard, North Park Toyota's general manager, said the added amenities are a way to create long-term relationships with customers.

For example, North Park has a separate service area for oil changes that competes with the likes of Jiffy Lube. The oil changes may not deliver huge profits but they keep people in contact with the dealer, he said. "We had to go get our customers back," Gothard said.